Passing by a McDonald’s, in addition to hunger, generates an idea that remains in the passerby’s head for a few minutes: how loaded the owner must be. A question whose answer is personal and complex to obtain, but for everything else, about how and how much it costs to be a franchisee, answers Luisa Masuet, general counsel and director of franchises at McDonald’s Spain.
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How many franchisees does McDonald’s have in Spain?
The community is made up of more than 100 franchisees. And each franchisee has an approximate average of three restaurants.
What average price does a McDonald’s franchise cost?
The initial contribution is, at present, 900,000 euros, although it is only required that at least 30 percent of that amount, plus the franchise rights and the guarantee deposit -that is, a minimum of 300,000 euros- be the one contributed by the future franchisee. This amount must come from own funds, that is, from the candidate’s personal assets, without having to proceed to its reimbursement or return from third parties as a loan or similar figures.
What does that price include?
McDonald’s establishes a partnership relationship with the franchisee which means that both are actively involved in the investment. As an example, note that when it comes to an opening, McDonald’s assumes the real estate cost, and the franchisee, which corresponds to the equipment.
Is there a waiting list to become a McDonald’s franchisee?
There is no waiting list as such. Selection processes are opened every time the company considers that it needs to incorporate more franchisees.
What is the franchisee selection process like?
For the selection process, the curriculum, qualities and skills of the candidates are taken into account. Several tests and interviews are carried out, for which we also have consultants external to the company. Once the selection of candidates has been made, they must train for a year in a restaurant, and this training is done from the base, going through all the positions to understand how each one of them works: team personnel, shift manager, manager etc
What training or experience should a potential franchisee have?
We are looking for people with initiative, risk capacity, who are used to managing teams. Top people who will help McDonald’s succeed, as well as achieve personal and commercial success for themselves. The important thing for us is that this person has an entrepreneurial spirit, the ability to lead teams, honesty, a strategic vision… a series of personal qualities that allow them to manage teams and run a business. Flexibility, customer orientation and hospitality.
When does it start to have economic return? What is the canon that each one has?
Profitability depends on a number of different factors, such as sales, location of the premises, costs of operations and also the ability of the franchisee to direct and control his business. The canon is variable, and is calculated based on the characteristics and specificities of each specific restaurant.
How much power do franchisees have? Do conflicts occur?
More than power, I would speak of influence. Franchisees form one of the strategic pillars of the system, along with suppliers and the brand. Therefore, their contribution to the system is key to its proper functioning. In this context, there may be disagreements with the criteria set by the company, but which, in general, do not translate into conflicts.
Do franchise sales usually occur?
They are very exceptional, but there are cases in which a franchise has become operated by another franchisee. In any case, whenever a transfer occurs, the company must authorize it, and it will always be done to a franchisee previously approved by Mc-Donald’s.
The location of a McDonald’s, who decides it?
All openings respond to strategic reasons and a business viability plan. Our main objective is to be present where the client demands our services and these are the main criteria, in addition to others, that the company follows when defining openings.
How many openings do you expect for the next few years?
McDonald’s continues to be the market leader in Spain. Currently, we are growing in openings at a sustainable rate, in order to ensure that all new restaurants meet the expectations of both our customers and our partners, the franchisees. Beyond the number of openings, the most important thing for McDonald’s is the number of customers we serve, as well as the service we can offer them. We have a strong commitment to the quality of the service we provide, the affordability of our products, our DNA, and so on.